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• Russia Deputy PM said “If you want to reject energy supplies from Russia, go ahead. We are ready for it”
• The approval of the Nord Stream 2 gas pipeline was halted by Germany last month
Western countries might face oil prices of over $300 per barrel, if they decide to impose full sanctions on Russia's energy exports, said Russian Deputy Prime Minister.
"It is absolutely clear that a rejection of Russian oil would lead to catastrophic consequences for the global market," Russian Deputy Prime Minister Alexander Novak said in a statement on state television, Reuters reported.
"The surge in prices would be unpredictable. It would be $300 per barrel if not more."
The statement came after US Secretary of State Antony Blinken said that the US and its European allies were considering banning Russian oil.
US President Joe Biden had a video conference call with the leaders of France, Germany, and the United Kingdom to enlist their support for the ban.
The US is willing to move ahead with a ban on Russian oil imports without the participation of allies in Europe, two people familiar with the matter told Reuters.
The approval of the Nord Stream 2 gas pipeline was halted by Germany last month.
"In connection with ... the imposition of a ban on Nord Stream 2, we have every right to take a matching decision and impose an embargo on gas pumping through the Nord Stream 1 gas pipeline," Russian Deputy PM said.
Russia provides 40% of Europe's natural gas. With roughly 7 million barrels per day, or around 7% of global production.
According to Russia's deputy prime minister, if Europe banned Russian oil and gas, it would take more than a year for nations to replace the volume of oil they receive from Russia, and they would have to pay higher prices.
“European politicians need to honestly warn their citizens and consumers what to expect,” Novak said.
“If you want to reject energy supplies from Russia, go ahead. We are ready for it. We know where we could redirect the volumes to.”
Oil prices have already reached their highest levels since 2008. Brent crude, the global standard, hit a record high of $139.13 while US oil benchmark, West Texas Intermediate crude futures soared to $130.50.
With inputs from Reuters
Picture Credits: FT